Rudd to unveil hospital overhaul

Prime Minister Kevin Rudd will unveil major changes to Australia's hospital system on Wednesday.

The announcement is nine months overdue. Mr Rudd had promised before the last election that a Labor government would take over the country's hospitals by July 2009 if the states and territories did not improve services.

Mr Rudd used Twitter to announce that he will address the National Press Club in Canberra to outline the overhaul.

It is expected the Prime Minister will move to have the Commonwealth fund public hospitals but stop short of taking control of their day-to-day operation from the states.

It is likely the Victorian model that determines funding by the types and volume of patients at each hospital will be used, with the Federal Government paying for part of the cost of each patient.

Mr Rudd is also set to renew his threat of going to the public with a referendum on a full takeover if things do not improve.

Speaking in Brisbane on Tuesday Mr Rudd said he expected to "cop a bit of stick" from the states over the proposal but he would not elaborate on its details.

"What I've said all along is that we will put a reform proposal to the states and territories and we would hope that they would accept it," he said.

"If they do not accept it, then of course we stand by our position of then going to the people to seek a mandate for taking over the full funding responsibility of the system.

"That's what I said prior to the election. That's what I say now."

Criticism

The Opposition has panned the policy ahead of its release.

Opposition Leader Tony Abbott says Mr Rudd's plan will lead to more process with no result.

"You've got state bureaucracies in New South Wales and Queensland which are proven failures," he said.

"You've got a federal bureaucracy which is obviously pretty ordinary at delivering services as you've seen from the pink batts disaster.

"I guess the question for the public is do you trust the bureaucrats who've given you the pink batts disaster to give you a functioning public hospital system?

"I think the answer is people will doubt it very much."

But Mr Rudd has accused Mr Abbott of being trigger happy with criticism.

"Can I just suggest to Mr Abbott and the Liberal Party, take a deep breath and just wait for a policy to be released and then engage in your criticism if you so will."

The Australian Medical Association (AMA) supports Commonwealth control of hospital funding.

"There is much more clarity in funding," AMA president Andrew Pesce told Radio National.

"The current mish-mash of funding that is provided through a combination of states and the Commonwealth means that when there is not sufficient funding, one arm of government can blame the other."

State resistance

But the states are likely to resist the proposal, which will be put to them at the next Council of Australian Governments (COAG) meeting.

Victorian Premier John Brumby says he is opposed to any takeover.

The National Health and Hospitals Reform Commission last year recommended the Federal Government take over full funding of outpatients and that it should fund 40 per cent of the minimum average cost of a patient's treatment while in hospital.

It said Australia's health system was fragmented and under increasing pressure from a growing population.

The report also recommended the Commonwealth take full control of primary health care and dental services.